High Achievers in FICO credit scores
Several potential homebuyers got frustrated because the standard for mortgage lending has become tougher, however most admired credit scores nowadays exposed some conducts of high-fliers that possessed FICO scores over 785.
San Jose, Calif-based Fair Isaac Corp.mentioned that people who occupy this population are about 50 million, a total of about a quarter of all who have credit scores. These individuals are believed to be high achievers and have comparable credit behaviors in spite of different background. Some predictable credit behavior is that they don’t exploit the use of their credit cards, kept little rotating balances comparable to what their presented credit, and are consistent about paying. On the other hand, they are not debt-free. They usually own seven credit cards with open and closed accounts. 1/3 of them have balances on nonmortgage accounts.
However, almost none has an overdue account. 96% have credit reports that do not have overlooked payments, and those who have one have already settled their accounts way back approximately a span of four years ago.
FICO scoresrun from 300 to 850 usually used by creditors to measure credit risk and the probability that a borrower will recompense a loan. The credit score can determine how much is offered to the lender and the period it will cover; a greater credit score can influence the amount that definitely will save thousands of dollars over the course of the loan.
Since last September, Ellie Mae Inc.reported a standard credit score of 750 with lenders paying an average of 22 percent. Moreover, applicants with FICO score of 704 were denied.
Fannie Mae and Freddie Mac gave an average FICO score of 762 in order to be considered eligible for purchasing mortgage, while loans with scores 701 on FHA-backed purchase.
The FICO scoreis calculated using the person’s payment history, and how he/she managed his/her credits responsibly as time gone by. An example is, by compensating monthly at least the least amount of all credit cards.
A person’s FICO score can be a roller coaster ride depending on his mood to make payments. By law, most negative data are removed from credit reports after several years of establishing a good track record. However, this does not apply to tax liens or bankruptcy as stated in Chapter 7.
With a challenging economic period, these high achievers are not perfect but are usually consistent in paying. It is good news and it’s never too late to go up again if you are plunging downwards.
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